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ADVERTISING AGREEMENT
AGREEMENT made as of the 14th day of January, 2000 (the
"EFFECTIVE DATE"), by and among BEASLEY INTERNET VENTURES, LLC, a Delaware
limited liability company ("BEASLEY") and FINDWHAT.COM, a Nevada corporation
(herein called "FINDWHAT").
ARTICLE I.
GENERAL DEFINITIONS
1.1 "Affiliate" of the Person concerned shall mean a Person that
directly or indirectly (through one or more intermediaries) controls, is
controlled by, or is under common control with such Person concerned.
1.2 "Beasley Competitor" shall mean any Person, other than Beasley,
who/which is engaged either directly, or indirectly through an Affiliate, in
radio programming or radio program distribution whether free over-the-air,
cable, telephone, local, microwave, direct broadcast satellite, via Internet or
otherwise in North America.
1.3 "Beasley Radio Network" shall mean those radio stations listed on
Exhibit C, attached hereto, as amended from time to time to reflect future
acquisitions and dispositions of radio stations by Beasley and its Affiliates.
1.4 "Content" shall mean text, graphics, photographs, video, audio
and/or other data or information relating to any subject and/or advertisements.
1.5 "Examination Commencement Date" shall have the meaning provided in
Section 2.2(a).
1.6 "Findwhat Site" shall mean the Internet Web Site owned by Findwhat
with a web address of www.findwhat.com, as may be changed from time to time.
1.7 "Internet" shall mean a global network of interconnected computer
networks, each using the Transmission Control Protocol/Internet Protocol and/or
such other standard network interconnection protocols as may be adopted from
time to time, which is used to transmit Content that is directly of indirectly
delivered to a computer or other digital electronic device for display to an
end-user, whether such Content is delivered through on-line browsers, off-line
browsers, or through "push" technology, electronic mail, broadband distribution,
satellite, wireless or otherwise.
1.8 "Internet Web Site" or "Web Site" shall mean any site or service
delivering Content on or through the Internet, including, without limitation,
any on-line service such as America Online and Compuserve.
1.9 "Person" shall mean individual, partnership, corporation or
organized group of persons, including agencies and other instrumentalities of
governments and states.
1.10 "Term" shall mean the term specified in Article 3.
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1.11 "Purchase Agreement" shall mean that Common Stock Purchase
Agreement dated as of the Effective Date by and between Findwhat and Beasley.
ARTICLE II.
BEASLEY ADVERTISING
2.1 PLACEMENT AND PAYMENT OF ADVERTISING.
(a) In exchange for the cash payments set forth and in
accordance with Section 2.1(d), Beasley shall arrange for the placement of radio
broadcast advertising on the Beasley Radio Network of the Findwhat Site and
Findwhat's other products and services of the placement types set forth in the
Advertising placement roster set forth in Exhibit A attached hereto, with an
aggregate value of Three Million One Hundred Eighty Thousand Dollars
($3,180,000) (the "CONTRACTED ADVERTISING AMOUNT"). In the event that Beasley
reduces the principal amount of the Note (as defined in Section 2.1(d) below)
pursuant to Section 12.7 of the Purchase Agreement, the Contracted Advertising
Amount shall automatically be reduced by an amount equal to such reduction in
the principal amount of the Note. Beasley shall arrange for the placement of
advertising among the stations in the Beasley Radio Network in accordance with
the advertising plan in Exhibit B attached hereto. All advertising materials
shall be subject to any applicable Beasley advertising guidelines and the
standard Beasley preemption policies.
(b) The value of all broadcast advertising provided hereunder
shall be as provided in Exhibit B hereto.
(c) Within twenty (20) days of the end of each calendar month,
Beasley will provide to Findwhat monthly invoices (each, an "ADVERTISING
INVOICE") dated as of the last day of the month in question (the "ADVERTISING
INVOICE DATE") showing the (i) value attributable to each of the placement types
with respect to the advertising purchased by Findwhat during the statement
period and (ii) the value of total advertising purchased for the period in
question (the "MONTHLY ADVERTISING AMOUNT") and the calculations performed to
determine such value.
(d) Within ten (10) business days of receipt of an Advertising
Invoice, Findwhat shall pay to Beasley, by certified or cashier's check, an
amount equal to the Monthly Advertising Amount, PROVIDED, HOWEVER, that Findwhat
may elect, in its sole discretion, to offset such payment obligation by reducing
the amounts owed under that certain Promissory Note, dated as of the date
hereof, made by Beasley, in the aggregate principal amount of Three Million
Dollars ($3,000,000) (the "Note"). Unless Findwhat provides Beasley written
notice to the contrary within five (5) business days of receipt of an
Advertising Invoice, Findwhat shall be deemed to have elected to reduce the
principal amount owed by Beasley under the Note and any accrued interest thereon
by the amount indicated in the Advertising Invoice in order to satisfy
Findwhat's obligation under this Section 2.1(d). Such reduction shall be deemed
to be made effective as of the Advertising Invoice Date.
2.2 ACCESS TO BOOKS AND RECORDS.
(a) Beasley will maintain accurate books and records which
report the value of advertising purchased by Findwhat and information from which
the calculation can be derived. Findwhat may, at its own expense, examine those
books and records on an annual basis.
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Findwhat may request such an examination upon no less than ten (10) business
days written notice to Beasley which shall commence on a date (the
"EXAMINATION COMMENCEMENT DATE") mutually agreeable to Beasley and Findwhat.
Such annual examination shall be completed within seven (7) days of the
Examination Commencement Date. Findwhat may make its examination only during
Beasley's usual business hours, and at the address set forth herein for the
provision of notices to Beasley, unless otherwise notified. No such
examination shall materially interfere with the normal business operations of
Beasley.
(b) Subject to the limitations of Section 2.2(a) hereof, if
upon examination of Beasley's books and records, Findwhat determines that
Beasley has failed to properly account for the value of advertising purchased by
Findwhat hereunder, Findwhat shall advise Beasley in writing of the basis for
its assertion, together with the information necessary to demonstrate Beasley's
failure to properly account for the value of advertising purchased by Findwhat
("FINDWHAT'S OBJECTION"). If Beasley agrees with Findwhat, then Beasley will
make appropriate adjustment(s) to the cumulative total of advertising to be run
during the remainder of the Term. If Beasley disagrees with Findwhat's
assertion, the parties shall negotiate in good faith to resolve any differences
for a period of seven (7) days, after which time if the parties continue to
disagree, they shall select a firm of independent certified public accountants
of national recognition (other than a firm which then serves as the independent
auditor for Beasley or Findwhat or any of their respective Affiliates) to
resolve the matter, whose decision on the matter shall be binding. If Beasley
and Findwhat are unable to agree on such a firm, then the regular independent
auditors for Findwhat and Beasley shall mutually agree upon a third independent
certified public accounting firm of national recognition, whose decision on the
matter shall be binding. Beasley and Findwhat shall share equally the fees and
expenses of the certified public accounting firm ultimately chosen. If Beasley
has not received Findwhat's Objection within fourteen (14) days of the
Examination Commencement Date, Findwhat shall be deemed to have been satisfied
with the results of its examination and shall not be entitled to the remedies
set forth in this Section 2.2(b).
2.3 SUSPENSION OF ADVERTISING. Beasley shall have the right to
suspend and/or withdraw placement of all advertising that includes any
trademark or tradename used by Findwhat, including but not limited to,
"FINDWHAT" and "FINDWHAT.COM": (i) pending resolution of any third party
claim alleging infringement of such third party's rights because of use by
Findwhat in the United States of the tradename or trademark in question
and/or (ii) during such time as Findwhat is enjoined from using the tradename
or trademark in question in the United States on or in connection with the
Findwhat Site and has not ceased use of the tradename or trademark in
question.
ARTICLE III.
TERM
The term of this Agreement shall begin as of the date hereof
and shall continue in full force and effect for a period of two (2) consecutive
years from the Effective Date (I.E., through and including January 13, 2002)
unless it is terminated earlier in accordance with the terms and conditions
stated herein (the "TERM").
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ARTICLE IV.
WARRANTIES, REPRESENTATIONS AND COVENANTS
4.1 BEASLEY. Beasley represents and warrants that:
(a) it has full power and authority to enter into and fully
perform this Agreement; and
(b) this Agreement has been duly authorized and is enforceable
in accordance with its terms.
4.2 FINDWHAT. Findwhat represents and warrants that:
(a) it has full power and authority to enter into and fully
perform its obligations under this Agreement; and
(b) this Agreement has been duly authorized and is enforceable
in accordance with its terms.
4.3 FINDWHAT COVENANTS. Findwhat covenants that:
(a) at all times during the Term, Findwhat shall comply with
all applicable federal, state, local and foreign laws;
(b) at all times during the Term, Findwhat shall maintain the
Findwhat Site in a professional manner consistent with industry standards;
(c) advertising material and any portion thereof created by or
on behalf of Findwhat and furnished by Findwhat to Beasley and the use thereof
shall not violate any law or infringe upon or violate the rights of any Person.
(d) Findwhat shall prevent the Findwhat Site from ceasing to
operate (i) more than two (2) consecutive hours per week over a sixty (60) day
period or (ii) more than ten (10) consecutive days, PROVIDED, HOWEVER, that if
the failure of the Findwhat Site to operate is as a result of circumstances
beyond Findwhat's control, Findwhat shall not be deemed to be in breach of this
Section 4.3(d)(ii) unless the Findwhat Site ceases to operate for more than
twenty (20) consecutive days.
ARTICLE V.
INDEMNIFICATION
5.1 INDEMNIFICATION BY FINDWHAT. Findwhat shall indemnify
Beasley, its members and each of their respective directors, officers,
employees, Agents and representatives (hereinafter referred to collectively
as "Beasley Indemnitees") against, and hold them harmless from, any and all
losses, damages, costs, liabilities, claims, obligations and expenses,
including reasonable legal fees and expenses, incurred or suffered by a
Beasley Indemnitee, as incurred (payable promptly upon written request),
arising from, in connection with or otherwise with
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respect to any breach, misrepresentation, or other violation of any covenant,
representation, warranty, term, condition or agreement of Findwhat contained
in this Agreement. The foregoing indemnity is intended by Findwhat to cover
all acts, suits, proceedings, claims, demands, assessments, adjustments,
diminution in value, costs and expenses with respect to any and all of the
specific matters in this indemnity set forth.
5.2 INDEMNIFICATION BY BEASLEY. Beasley shall indemnify
Findwhat, its directors, officers, employees, Agents and representatives
(hereinafter referred to collectively as "FINDWHAT INDEMNITEES") against, and
hold them harmless from, any and all losses, damages, costs, liabilities,
claims, obligations and expenses, including reasonable legal fees and
expenses, incurred or suffered by a Findwhat Indemnitee, as incurred (payable
promptly upon written request), arising from, in connection with or otherwise
with respect to any breach, misrepresentation, or other violation of any
covenant, representation, warranty, term, condition or agreement of Beasley
contained in this Agreement. The foregoing indemnity is intended by Beasley
to cover all acts, suits, proceedings, claims, demands, assessments,
adjustments, diminution in value, costs and expenses with respect to any and
all of the specific matters in this indemnity set forth.
5.3 CONDUCT OF PROCEEDINGS. If any claim or proceeding covered
by Sections 5.1 or 5.2 shall arise, the party which seeks indemnification
(the "INDEMNIFIED PARTY") shall give written notice thereof to the other
party (the "INDEMNITOR") promptly after the Indemnified Party learns of the
existence of such claim or proceeding; PROVIDED, HOWEVER, that the
Indemnified Party's failure to give the Indemnitor prompt notice shall not
bar the Indemnified Party's right to indemnification unless such failure has
materially prejudiced the Indemnitor's ability to defend the claim or
proceeding. The Indemnitor shall have the right to employ counsel reasonably
acceptable to the Indemnified Party to defend against any such claim or
proceeding, or to compromise, settle or otherwise dispose of the same, if the
Indemnitor deems it advisable to do so, all at the expense of the Indemnitor.
The parties will fully cooperate in any such action, and shall make available
to each other any books or records useful for the defense of any such claim
or proceeding.
5.4 EXCLUSIVE REMEDY. Except with respect to third party claims
for which each party shall fully indemnify the other in accordance with the
procedures set forth in this Article 5 neither party shall be liable to the
other party for any "business interruption" or any loss of profits, any
indirect, incidental, special, punitive or consequential damages hereunder,
whether foreseeable or not.
5.5 LIMITS ON AND CONDITIONS OF INDEMNIFICATION; THRESHOLD AND
CAP. Notwithstanding any other provision hereof, no Indemnified Party shall
be entitled to make a claim against an Indemnitor in respect of any breach of
this Agreement except to the extent that the aggregate amount of such damages
exceeds the amount of Thirty Thousand Dollars ($30,000); PROVIDED, HOWEVER,
that once such aggregate has been exceeded, such Indemnitor shall be liable
for the full amount of such damages. Notwithstanding any other provision of
the Agreement, neither the indemnity obligation of Seller nor the indemnity
obligation of Buyer shall exceed Three Million Dollars ($3,000,000).
Notwithstanding the preceding sentence, any amount of damages counted toward
the indemnity threshold and Three Million Dollar ($3,000,000) cap on
Findwhat's indemnification obligations in Section 12.6 of
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the Purchase Agreement shall also be counted against the indemnity threshold
and cap on Findwhat's indemnification obligations in this Section 5.5.
5.6 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND INDEMNIFICATION
RIGHTS. The several covenants, representations, warranties, terms, conditions
or agreements contained herein, and the parties respective indemnification
rights pursuant to Article 5, shall endure for the Term, at which time the
same shall expire (except for Claims asserted during the Term).
ARTICLE VI.
REMEDIES
6.1 FINDWHAT'S RIGHT OF TERMINATION. The Agreement may be
terminated by Findwhat if Findwhat is not then in material default, upon
written notice to Beasley upon the occurrence of any of the following:
(a) Beasley breaches any material term or condition of this
Agreement or the Purchase Agreement and has failed to cure such breach within
thirty (30) days following notice of default. The foregoing cure period will not
apply to: (i) a term or condition for which a specific cure period is provided,
or (ii) a breach incapable of being cured.
(b) If the BRN Cume (as defined in Exhibit B, paragraph 2)
drops below One Million Five Hundred Thousand (1,500,000) listeners.
(c) If Beasley sells each and every one of the radio stations
listed on Exhibit D in one or more transactions during the Term.
6.2 UPON TERMINATION. Upon termination of this Agreement
pursuant to Section 6.1, the parties shall be released and discharged from
any further obligation under this Agreement. Notwithstanding the foregoing,
the rights and obligations of the parties with respect to Article 5
(Indemnification), Section 7.1 (Permitted Assignments), Section 7.3 (Notice)
and Section 7.7 (Governing Law) hereof shall not terminate.
6.3 NO FORFEITURE OF FINDWHAT STOCK. As between Beasley and
Findwhat, Findwhat agrees that under no circumstances are the shares of
common stock of Findwhat, $.001 par value per share, issued to Beasley
pursuant to the Purchase Agreement, returnable to Findwhat or subject to
forfeiture. Findwhat covenants not to seek the return of the shares in any
proceeding, between Beasley, its successors and assigns and Findwhat, its
successors and assigns provided, however, the foregoing shall not limit
Findwhat's right to enforce its rights under the Note.
ARTICLE VII.
GENERAL
7.1 PERMITTED ASSIGNMENTS. This Agreement shall be binding upon
and inure to the benefit of the parties and their respective successors and
permitted assigns. No party may assign its respective rights and obligations,
in whole or in part, under this Agreement without prior written consent of
the other party hereto. Any attempt to assign this Agreement without such
consent shall be void and of no effect ab initio. Notwithstanding the
foregoing, a party hereto may assign this Agreement or any of its rights and
obligations hereunder to any entity
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controlling, controlled by or under common control with, such party, or to
any entity that acquires such party by purchase of stock or by merger or
otherwise, or by obtaining substantially all of such party's assets (the
"PERMITTED ASSIGNEE"), provided that (i) no such assignment shall relieve the
assigning party of any of its obligations under this Agreement; (ii) with
respect to any assignments effected by Findwhat, no such Assignee (or any
division thereof) is a Beasley Competitor and (iii) such Permitted Assignee
shall agree in writing to be bound by the terms and conditions hereof.
7.2 SEVERABILITY. If any provision of this Agreement (or any
portion thereof) or the application of any such provision (or any portion
thereof) to any Person or circumstance shall be held invalid, illegal or
unenforceable in any respect by a court of competent jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other
provision hereof (or the remaining portion thereof) or the application of
such provision to any other Persons or circumstances, and such provision will
be limited or eliminated to the minimum extent necessary so that this
Agreement shall otherwise remain in full force and effect.
7.3 NOTICE. All notices or other communications required or
permitted to be given hereunder shall be in writing and shall be delivered by
hand, sent by telecopy or sent, postage prepaid, by registered or certified
mail, return receipt requested, or reputable overnight courier service and
shall be deemed given when so delivered by hand, or if telecopied, when
received, or if mailed, five business days after mailing (one business day in
the case of express mail or overnight courier service), as follows:
(a) if to Findwhat,
Findwhat.com
121 West 27th Street
Suite 903
New York, New York 10001
Tel: (212) 255-1500
Fax: (212) 989-4392
Attention: Chief Executive Officer
with a copy to:
Leonard D. Steinman, Esq.
Tenzer Greenblatt LLP
405 Lexington Avenue
New York, New York 10174
Tel: (212) 885-5524
Fax: (212) 885-5002
(b) if to Beasley,
Beasley Internet Ventures, LLC
3033 Riviera Drive, Suite 200
Naples, Florida 34103
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Tel: (941) 263-5000
Fax: (941) 434-8950
Attention: Caroline Beasley
with a copy to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Avenue, N.W.
Suite 1300
Washington, D.C. 20004
Tel: (202) 637-2221
Fax: (202) 637-2201
7.4 INDEPENDENT CONTRACTORS. The parties to this Agreement are
independent contractors. There is no relationship of partnership, joint
venture, employment, franchise, or agency between the parties. No party shall
have the power to bind any other party or incur obligations on any other
party's behalf without such other party's prior written consent.
7.5 WAIVER. The waiver by any party of a breach or default of
any provision of this Agreement by any other party shall not be construed as
a waiver of any succeeding breach of the same or any other provision, nor
shall any delay or omission on the part of any party to exercise or avail
itself of any right, power or privilege that it has, or may have hereunder,
operate as a waiver of any right, power or privilege by such party except as
otherwise specifically provided in this Agreement.
7.6 ENTIRE AGREEMENT. This Agreement, including any agreement
incorporated herein by reference, and any Exhibits hereto or thereto,
contains the entire agreement and understanding between the parties hereto
with respect to the subject matter hereof and supersedes all prior agreements
and understandings relating to such subject matter. No party shall be liable
or bound to any other party in any manner by any representations, warranties
or covenants relating to such subject matter except as specifically set forth
herein.
7.7 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York
applicable to agreements made and to be performed entirely within such State,
without regard to the conflicts of law principles of such State.
7.8 SOLE BENEFIT. This Agreement is for the sole benefit of the
parties hereto and their permitted assigns and nothing herein expressed or
implied shall give or be construed to give to any Person, other than the
parties hereto and such assigns, any legal or equitable rights hereunder.
7.9 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement,
and shall become effective when one or more such counterparts have been
signed by each party and delivered to each other party.
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7.10 AMENDMENT. This Agreement may not be amended except by an
instrument in writing signed on behalf of each party hereto. By an instrument
in writing Beasley or Findwhat, as the case may be, may waive compliance by
the other party with any term or provision of this Agreement that Beasley or
Findwhat, as the case may be, was or is obligated to comply with or perform.
7.11 HEADINGS. The headings contained in this Agreement hereto
are for reference purposes only and shall not affect in any way the meaning
or interpretation of this Agreement. Any capitalized terms used in any
Exhibit but not otherwise defined therein, shall have the meaning as defined
in this Agreement. When a reference is made in this Agreement to a Section or
Exhibit, such reference shall be to a Section of, or an Exhibit to, this
Agreement unless otherwise indicated.
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IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed by their duly authorized representatives as of the date first above
written.
BEASLEY INTERNET VENTURES, LLC
By: BEASLEY FM ACQUISITION CORP.,
its Managing Member
By: /s/ B. Caroline Beasley
----------------------------
Name: B. Caroline Beasley
Title: Secretary
FINDWHAT.COM
By: /s/ Robert D. Brahms
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Name: Robert D. Brahms
Title: chief Executive Officer
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